What do you think of these two houses?

[Aaron Wyssmann]

I've run across a couple properties and would love some input, thoughts, etc on how to possibly structure a deal.  I've got my own thoughts but would love some others.  The seller is a father of a friend of mine who is 83 and just doesn't have the health to deal with them any longer.  He is willing to do some seller financing.

They were both built around 1890 so they are quite old. The neighborhood is what I would call lower class B (I think?).  The area is safe (two blocks from the main police station and county courthouse) but attracts some of the not-so-great crowd.  I've driven past the homes and they are in decent repair and believe that he has taken good care of the homes.  

The renters he has in there currently are all from a local charitable organization.  The organization pays the first 6 months of rent and then after that the tenants have full responsibility.  Obviously he has lots of turnover because then they pay very late or don't pay at all.  I could definitely find better tenants.

The homes are both separately metered for electric and gas but not for water/sewer.

HOUSE #1 (Duplex) -  Asking $50,000

2bed - Rents for $400

1bed - Rents for $350

Insurance would be roughly $60, taxes are $48, trash $20, and water/sewer $90 (all monthly costs)

HOUSE #2 (Triplex) - Asking $50,000

2bed - $400

1bed - $350

1bed Efficiency - Lets his maintenance man of 5 years stay rent free.  I'd say I could at least get $150-200.  Owner wants him to continue to stay for free but I don't I can let that happen nor do I need that, have my own crews.

Insurance would be roughly $65, taxes are $42, trash $20, and water/sewer $135 (all monthly costs)

This one has a newer roof and I believe some siding.

QUESTIONS:

What kind of a percentage is running the numbers should I use for Capital Expenses?

What issues can I expect with homes that are of this age?

What am I missing?

Ok, so enlighten me with your wisdom. I would love to know what you all think of this @Nathan Brooks and @Brandon Turner .